A new round of arm race in Asia is about to start with Japan’s announcement today.

Source: CNBC mobile.

Let the show begin. The last one standing will be the one with the deepest pocket and lowest debt.

Soviet Union lost the war to the United States because the former was broke. Let’s see how much further Japan can go with a national debt to DGP ratio of 220+%. The race isn’t just about arms though. The war will be fought on the economy too.

Korea will join the race soon.

Last I checked, Japan imports about 99.5% of its crude and natural gas needs. This serious shortcoming is like the 紧箍儿 on 孫悟空’s head. As long as this choke point is being controlled by another nation, Japan’s option will be severely limited. This is kind like a scene in 西遊記 where no matter what 孫悟空 does, the monkey king just cann’t escape from Buddha’s hand.

Btw, is this 阿倍’s secret 4th arrow since the first two got lost in oblivion and the third was more like a dart looking for a target?

What is the root cause of the problem? Was it democracy Taiwanese style or failed leadership from the top? Was it structural problem rooted in the economy of Taiwan?

Granted, it was a very small sample taken on the web and most people who participated in the survey were probably young students, the disturbing survey result is nonetheless a reflection of what people in Taiwan are most concerned about.

Is this the Taiwan I left almost 40 years ago? The answer is a decisively NO.

People are free to express their displeasure and criticize their central and local governments. People are free to gather in public to demonstrate and block the traffic. People are free to voice their concerns of various issues. People are proud of their votes in hotly contested elections.

People of my generation back then didn’t have any of this.

Is the change good for the place I used to call home?

哎，人生不如意十有八九。May be I shouldn’t “太过计较.” The politicians and their high-paying big mouth consultants have messed up the place and who is going to clean up their “S###” after them?

Economics is often described as a Social Science. However, it has nothing to do with science. I am afraid.

We might want to call it “Social Guesstimate” instead. And the guess work by economists has been a really “dismal” one.

Way back on February 14, 2014, the Philadelphia Fed published a report called “First Quarter 2014 Survey of Professional Forecasters.”

On Philadelphia Fed’s web page, it proudly displayed the following:

Survey of Professional Forecasters

The Survey of Professional Forecasters is the oldest quarterly survey of macroeconomic forecasts in the United States. The survey began in 1968 and was conducted by the American Statistical Association and the National Bureau of Economic Research. The Federal Reserve Bank of Philadelphia took over the survey in 1990.

The Survey of Professional Forecasters’ web page offers the actual releases, documentation, mean and median forecasts of all the respondents as well as the individual responses from each economist. The individual responses are kept confidential by using identification numbers.

Well, Chinese has this saying that “丑媳妇总得见公婆“ which means: “no matter how ugly one’s wife is, she has to meet his parents some day.”

That day for our “ugly” economists was April 30, 2014 when the Commerce Department said US GDP grew 0.1% in the first quarter 214 on an annual base.

Well, they collectively were off by 1.9%. At least they got the direction of economy right. The economy in the US grew even though the predict was way off.

Well, our “ugly” economists have to meet other people in the family too. That day came on May 29, 2014 when the first quarter 2014 GDP was revised down to a decline of 1%.

Now, our “ugly” economists were off by 3%; from +2% to -1%.

The really bad news came when our “ugly” economists have to pay their respects to “grandma and grandpa” of the family on June 25, 2014 just a few days before.

The final revision of 1st quarter GDP came in at -2.9%.

Now, these high paying, data manipulating, big mouth “economists” are off collectively by 4.9%; from +2% to -2.9%.

How could this be? Most if not all of these economists are PhDs from most respected and world renowned institutions all over the world. How could they be so wrong? I am sure a few of them are making rounds on TV or radio talk shows explaining away their “dismal” predictions.

They deserve a big F if you ask me and we shouldn’t listen to them at all.

In fact, we should just ignore them all together even though I am so intrigued by the “dismal science” that I spend all my spare time on the topic of macroeconomics.

Am I so crazy that I couldn’t see pass their performance?

Well, after being an engineer most of my adult life when all my conclusions were subject to peer reviews, I found economics interesting precisely because the outcome of all these economic indicators is so unpredictable. I can make all kind of predictions and no one really care about what I say.

Those 45 economists (we don’t know who they are. The Fed won’t tell us) have such an easy job: they got things totally wrong but no one challenged them. They weren’t ridiculed in public. Their pays weren’t cut by their bosses. They continued to speak about matters on economy and make predictions like nothing was wrong in the past. No demotion. No performance review either.

The worst part of all this is that the Fed and other central banks have been using all these predictions to make life changing monetary policy decisions to economies all over the world since early 1900.

No wonder we have had inflation, deflation, boom and bust and occasion disasters but the Fed was never held responsible for their mistakes.

The Redbacks will be a lot more popular a few years down the road. The ascend of the Redbacks against the Greenbacks will resume and you might want to diversify into the Redbacks to get some protection before it’s too late.

Many American Politicians can’t wait to get out of the office because that’s when they can start making big money. I call it ‘legalized bribery.

Hillary gave us a very good example and it is excessive and extremely ‘outrageous’ to say the least.

Now, that kind of money isn’t exactly free though. It comes with some bagage too: the guy who paid $225,000 simply wanted some face time, a relationship and something tangible later such as an Ambassador or a government project in the future.

Americans is in the business of ‘guanxi 關係’ too. They like it a lot and they do it openly.

Many people have no idea what this is about and we are not talking about Merilyn Monroe either.

America’s influence has been waning and this is another nail in the coffin; so to speak.

By now, we all are fully aware that under the incompetent and feckless “joke,” aka Obama, (Hillary’s words, allegedly) America’s influence on Middle East has been on the decline. Many people denied its true extend and called it a temporary set back. Well, the story didn’t stop at the border of the dedert, it is happening here in America’s backyard too.

America has formally withdrawn from the South America in the Western Hemisphere. Secretary of State Kerry on November 18, 2013 repudiated the Monroe Doctrine. He did it ina speech to the Inter-American Dialogue.

Here’s an excerpt of what he said:
“In the early days of our republic, the United States made a choice about its relationship with Latin America. President James Monroe, who was also a former Secretary of State, declared that the United States would unilaterally, and as a matter of fact, act as the protector of the region. The doctrine that bears his name asserted our authority to step in and oppose the influence of European powers in Latin America. And throughout our nation’s history, successive presidents have reinforced that doctrine and made a similar choice.”

“Today, however, we have made a different choice. The era of the Monroe Doctrine is over.”

Well, from 1823 to 2013, America has considered South America its own territory and told Europe to leave them alone. Today, 190 years later, Kerry was merely stating the obvious because America no longer has any say on matters important to people of the South American.

America in decline has been confirmed once again. This time by someone of them own.